Friday July 9, 2010 - 03:51:06 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 09-Jul-2010 - 0345 GMT
The US Markets closed up over a favorable Jobless benefits data release yesterday. The Dow (10139.99) closed up 1.20% and the S&P 500 (1070.25) closed up 0.94%. The Dow may move up towards 10200-50 this week.
The Asian Equities are silent today. The Nikkei (9542.01) and the Shanghai (2415.91) are flat. In India, the Sensex (17651.73) was up 1.03% and the Nifty (5296.85) was up 1.06% yesterday. The Sensex has been moving in the region of 17450-750 for the past few days and we need to wait and watch on which side of the range does it break in the coming weeks.
Crude (75.77) is continuing to trade higher. EIA's report showing higher than expected fall in the US Crude inventories and the strong equity markets supported the price rise yesterday. A strong break above 76 might trigger further upmove towards 78 in the coming days. To see the Crude graph click on the following link:
Gold (1196.50) is continuing to trade lower. However, much momentum on the downside is not seen and is oscillating around 1200 over the last few days. A dip to 1180-70 is looking likely. However, the broader picture is bullish.
The Gold/Crude ratio is currently moving in a bear channel. Also the Trendline Resistance joining the Jul-09 high and Dec-09 high is continuing to hold very well which suggests a further downmove in the Gold/Crude ratio towards the lower end of the bear channel. This leaves out a greater possibility of a rise in Crude price to 78-80 and Gold might be ranged between 1200-1170. To see the Gold/Crude ratio graph click on the following link:
Further strength in the Euro (1.2690) led to a high of 1.2712 yesterday. Strong trendline Resistance seen at the current levels. Profit-taking possible. Dollar-Yen (88.50) is looking biddish in the near term, targeting 89.25. The Euro-Yen Cross (112.35) has risen well yesterday on the back of strength in EUR-USD and USD-JPY. Could see some profit-taking alongwith the Euro.
Dollar-Swiss (1.0505) has been quiet yesterday after having broken below the 200-day MA the day before. It may have Support near 1.0435 today. The Pound (1.5155) has been quiet yesterday, just below Resistance at 1.52-53 through yesterday. A spike to test the Resistance at 1.52-53 cannot be ruled out today. The Aussie (0.8760) is holding onto its gains and could target 0.8850.
In Asia, Dollar-Won (1205.40) has dipped further yesterday, but may find Support near 1200 today. USD-SGD (1.3783) continues to fall, more or less in line with its neighbour, the Malaysian Ringgitt. Dollar-Rupee had closed at 46.86 yesterday and might dip slightly more towards 46.75-65 today, following other Asian currencies.
The 3M USD LIBOR was unchanged at 0.53%. The 2Y yield was flat at 0.62% and the 10Y yield was up 3 bps to quote at 3.02%.
Yesterday, the BOE and ECB left their interest rates unchanged at 0.50% and 1.00% respectively.
08:30 GMT UK June Trade Balance
...Expected $ -7.1 Bln...Previous $ -7.3 Bln
12:00 GMT June CA Labour Force
...Expected 20.3K...Previous 24.7K
June Australia Labour Force
...Actual 45.9K...Previous 22.8K
...Actual 0.50%...Previous 0.50%
E-15 ECB Announcement
...Actual 1.00%...Previous 1.00%
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